Pound Rises as Dollar Pauses Amid Trade Uncertainty

The British Pound pushed higher against the US Dollar on Wednesday, climbing toward the mid-1.35 area as uncertainty surrounding US trade policy kept the Greenback largely range-bound. With little fresh economic data to guide markets, investors focused instead on central bank signals and broader sentiment, allowing Sterling to gain modest ground.


The Dollar has struggled to build momentum in recent sessions, weighed down by lingering questions over the direction of US trade measures and their potential impact on growth. This cautious backdrop has limited demand for the US currency, creating space for GBP/USD to edge higher.


At the same time, expectations around interest rates remain central to the pair’s movement. In the United Kingdom, policymakers have indicated that a rate cut in the coming months is possible, though not guaranteed. Markets are pricing in limited easing, reflecting a belief that any reductions will be gradual and data-dependent. That balanced outlook has helped prevent significant downside pressure on the Pound.


In the United States, central bank officials have struck a careful tone, signaling that while rate cuts could come later in the year, they are in no rush to move without clearer evidence that inflation is firmly under control. As a result, traders are not expecting immediate policy changes, but they continue to anticipate some easing before year-end.


With both central banks navigating a delicate path, GBP/USD remains sensitive to shifts in expectations. For now, the Dollar’s pause amid trade uncertainty has tilted the short-term balance slightly in favor of Sterling, keeping the pair supported near recent highs.